Prafulla Das

Bhubaneswar, June 15

KOREAN steel major Pohang Steel Company (Posco) is likely to sign the memorandum of understanding with the Orissa Government for setting up the 12-million-tonne-a-year capacity integrated steel project at Paradip next week.

Although no date has been officially fixed for signing the agreement, the MoU is expected to be signed on June 22, sources in the State Government said.

"All the issues involved have been thrashed out and the possibility of signing the MoU on June 22 is very high," Mr Ryu Ho Chang, the team leader of the Posco project in Orissa, told Business Line on Wednesday.

When contacted over phone, the State Steel and Mines Minister, Mr Padmanabha Behera, also spoke on similar lines.

"It is certain that the MoU will be signed soon. Since today was a holiday, the date for signing of the MoU will be finalised tomorrow," Mr Behera said.

The signing of the MoU was delayed as the State Government took a long-time to decide whether to allow the company to export any amount of iron ore from the State.

Finally, both sides reached an agreement that the company will export a certain quantity of iron ore, while importing an equal quantity of ore from outside the country.

The Posco project, which will be the biggest-ever foreign direct investment in India, will be implemented in three phases at a projected cost of Rs 52,000 crore. It will have a capacity to make three million tonnes of steel a year in five years' time, and thereafter three mt capacity will be added every two years.

It will also have a 30-mt capacity iron ore mine.

(This article was published in the Business Line print edition dated June 16, 2005)
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